Novo Nordisk sees double-digit FY growth as Q4 profit beats estimate

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Written By Pinang Driod

© Reuters. The logo of Danish drugmaker Novo Nordisk, Copenhagen, Denmark, September 26, 2023. REUTERS/Tom Little

COPENHAGEN/LONDON (Reuters) – Novo Nordisk (NYSE:) on Wednesday forecast another year of double-digit sales and operating profit growth as it began easing restrictions on supply of its popular weight-loss drug Wegovy.

The company, which has raced to increase output amid shortages of Wegovy, said it started gradually increasing the supply of the lower dose strength of the drug in the United States in January.

Novo was last year unable to meet runaway demand for Wegovy, and in May began limiting the number of U.S. patients who can start treatment by reducing the supply of the lowest three doses of the appetite-suppressing weekly injection.

Wegovy sales totalled 9.6 billion Danish crowns ($1.39 billion) between October and December, slightly lower than the previous quarter and a four-fold rise from the same period a year earlier.

The company said it aimed this year at “a gradual roll-out of Wegovy with capped volumes” outside the U.S.

Novo expects sales growth this year between 16% and 25% and operating profit to rise 19%-28% as demand soars for Wegovy and diabetes drug Ozempic, which contains the same active ingredient.

Analysts on average expect Novo Nordisk to deliver sales growth of 21% this year, according to LSEG data.

“We are very pleased with the strong performance in 2023, reflecting that more than 40 million people are now benefiting from our innovative diabetes and obesity treatments,” CEO Lars Fruergaard Jorgensen said in a statement.

The company said fourth-quarter sales rose 37% from a year earlier to 65.9 billion crowns, compared with 62.3 billion forecast by analysts in an LSEG poll.

Earnings before interest and taxation (EBIT) rose 57% to 26.8 billion, compared with a forecast of 24.9 billion.

The results underscore Wegovy’s success and Novo’s lead in the fast-growing obesity drug market, even as the company faces early competition from U.S. rival Eli Lilly (NYSE:).

Novo shareholder Markus Manns, portfolio manager at Union Investment, said the guidance was “strong”, and welcomed news that supplies of lower-dose Wegovy this month have improved as the company has scrambled to boost output to meet soaring demand.

Strong demand for Wegovy and Ozempic has propelled Novo’s shares to record highs, making it Europe’s most valuable listed company, worth more than 450 billion euros ($487 billion), ahead of LVMH.

It also provided an economic bonanza for its home country of Denmark.

(This story has been corrected to show forecasts for sales and profit growth are not for new record in paragraph 1)

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